Jones didn't respond to requests for comment Tuesday morning. Both responses represent Sprout's first public admission that it shuttered July 6. In separate filings Tuesday, attorney Nathan Jones of Uniondale, New York-based Forchelli Deegan Terrana LLP responded to the complaints, requesting the federal judges overseeing the cases deny all claims against Sprout. New Wave Lending Group, another Industry, California-based non-QM lender, filed a complaint against Sprout in July for approximately $6 million, seeking recourse for Sprout's failure to purchase $32 million worth of loans.
Toms River, New Jersey-based non-QM lender Family First Funding, unrelated to FirstFunding, sued Sprout in May for breach of contract for defaulting on a purchase of $5.1 million in loans. "Sprout and Strauss are no longer working cooperatively with FirstFunding to effectuate the prompt disposition of the Pledged Mortgage Loans and reduction of advances under the Funding Agreement to maximize value," wrote attorney Benjamin West of Dallas-based Frost Brown Todd LLC, on behalf of FirstFunding.įirstFunding is seeking the $262,500 in a Banc of California account Sprout was supposed to transfer to satisfy their agreement along with temporary, preliminary and permanent injunctive relief to prevent Sprout and its employees from misappropriating other monies due.Ĭounsel for FirstFunding and representatives for Sprout, FirstFunding and Banc of California didn't return requests for comment Monday afternoon.Īn attorney for Sprout meanwhile responded to two other lawsuits Tuesday, denying all accusations of wrongdoing but admitting for the first time the lender had shut down. Sprout has since failed and refused to pay FirstFunding its dues under the agreement, counsel for FirstFunding wrote.
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